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This 5 page Class Notes was uploaded by Gerda Pacocha on Saturday October 3, 2015. The Class Notes belongs to ACC208 at California State Polytechnic University taught by AhmedAbo-Hebeish in Fall. Since its upload, it has received 7 views. For similar materials see /class/218391/acc208-california-state-polytechnic-university in Accounting at California State Polytechnic University.
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Date Created: 10/03/15
Brief Exercise 11 10 minutes H OkOOONO AU39lhUONi I Directing and motivating Budgets Planning Precision Timeliness Managerial accounting Financial accounting Managerial accounting Financial accounting Managerial accounting Feedback Controller Performance report Brief Exercise 12 10 minutes 1 2 lO AU39lb w 00 The cost of a hard drive installed in a computer direct materials The cost of advertising in the Puget Sound Computer User newspaper selling The wages of employees who assemble computers from components direct labor Sales commissions paid to the company s salespeople selling The wages of the assembly shop s supervisor manufacturing overhead The wages of the company s accountant administrative Depreciation on equipment used to test assembled computers before release to customers manufacturing overhead Rent on the facility in the industrial park a combination of manufacturing overhead selling and administrative The rent would most likely be prorated on the basis of the amount of space occupied by manufacturing selling and administrative operations Brief Exercise 13 15 minutes Product Period Cost Cost 1 Depreciation on salespersons cars X 2 Rent on equipment used in the factory X 3 Lubricants used for machine maintenance X 4 Salaries of personnel who work in the finished goods warehouse X 5 Soap and paper towels used by factory workers at the end of a shift X cough 0 1 H 12 13 14 15 Advertising costs Workers compensation insurance for factory Factory supervisors salaries Heat water and power consumed in the factory Materials used for boxing products for shipment overseas units are not normally boxed employees Depreciation on chairs and tables in the factory lunchroom The wages of the receptionist in the administrative offices Cost of leasing the corporate jet used by the company39s executives The cost of renting rooms at a Florida resort for the annual sales conference The cost of packaging the company s product Brief Exercise 14 15 minutes Sales CyberGames Income Statement Cost of goods sold Beginning merchandise inventory 240000 Add Purchases 9 30 000 Goods available for sale 1190000 Deduct Ending merchandise inventory 170 000 Gross margin Selling and administrative expenses Selling expense 210000 Administrative expense 180000 Net operating income 1450000 1020000 430000 390000 g 40000 Brief Exercise 15 15 minutes Lompac Products Schedule of Cost of Goods Manufactured Direct materials Beginning raw materials inventory 60000 Add Purchases of raw materials 690000 Raw materials available for use 750000 Deduct Ending raw materials inventory 45000 Raw materials used in production 705000 Direct labor 135000 Manufacturing overhead 370000 Total manufacturing costs 1210000 Add Beginning work in process inventory 120000 1330000 Deduct Ending work in process inventory 130000 Cost of goods manufactured 1200000 Brief Exercise 16 15 minutes A few of these costs may generate debate For example some may argue that the cost of advertising a rock concert is a variable cost because the number of people who come to the rock concert depends on the amount of advertising However one can argue that if the price is within reason any rock concert in New York City will be sold out and the function of advertising is simply to let people know the event will be happening Moreover while advertising may affect the number of persons who ultimately buy tickets the causation is in one direction If more people buy tickets the advertising costs don t go up C ost Behavior Cost Measure ofActiVity Variable Fixed 1The cost of Xray film used in the radiology lab at Virginia Mason Hospital in Seattle Number of Xrays taken X 2The cost of advertising a rock concert in New York City Number of rock concert tickets sold X 3The cost of renting retail space for a McDonald s restaurant in Hong Kong Total sales at the X resta ura nt 4The electrical cost of running a roller coaster at Magic Mountain Number of times the roller coaster is run X 5Property taxes paid by your local cinema theater Number of tickets sold X 6The cost of sales commissions paid to salespersons at a Nordstrom store Total sales at the store X 7Property insurance on a Coca Cola bottling plant Number of cases of bottles produced X 8The costs of synthetic materials used to make a particular model of running shoe Number of shoes of that model produced X 9The costs of shipping Panasonic televisions to retail stores Number of televisions sold X 10The cost of leasing an ultrascan diagnostic machine at the American Hospital in Paris Number of patients scanned with the machine X Brief Exercise 17 15 minutes Direct Indirect Cost C ost Object Cost C est 1 The wages of pediatric The pediatric nurses department X 2 Prescription drugs A particular patient X 3 Heating the hospital The pediatric department X 4 The salary of the head The pediatric of pediatrics department X 5 The salary of the head A particular pediatric of pediatrics patient X 6 Hospital chaplain s A particular patient salary X 7 Lab tests by outside A particular patient contractor X 8 Lab tests by outside A particular department contractor X Brief Exercise 18 15 minutes H Di erentia Opportunity Sunk Item Cost C ost Cost Cost of the old Xray machine X The salary of the head of the Radiology Department The salary of the head of the Pediatrics Department Cost of the new color laser printer X Rent on the space occupied by Radiology The cost of maintaining the old machine X Benefits from a new DNA analyzer X Cost of electricity to run the X ray machines X Note The costs of the salaries of the head of the Radiology Department and Pediatrics Department and the rent on the space occupied by Radiology are neither differential costs nor opportunity costs nor sunk costs These costs do not differ between the alternatives and therefore are irrelevant in the decision but they are not sunk costs because they occur in the future
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